The Hindu Business Line : Vijaya Bank may seek US listing

Asked about the possibility of a US listing, the Vijaya Bank's Chairman and Managing Director, Mr M.S. Kapur, told Business Line today, "Let us talk about it after March 31."

Sources close to the bank had earlier mentioned that the casting of accounts by US GAAP principles could be a prelude to the bank seeking a listing in the US.

Mr Kapur said the recast accounts showed a net profit of nearly Rs 400 crore for 2002-03, against Rs 198 crore by Indian accounting standards.

The difference essentially lies in the treatment of certain types of income and expenditure. Some spends, like those related to initial public offering, would be treated as expenditure under Indian accounting standards. But they would be deferred over a number of years under US GAAP.

Mr Kapur said the current year's final accounts would also be cast both as per Indian and US accounting standards.

He said the agreement for forming a new life insurance company would be signed in the first week of March.

Mr Kapur said Berger Paints would join hands with Punjab National Bank, Vijaya Bank and Principal Financial Services of US to form the insurance company. Berger Paints would pick up 37 per cent stake in the insurance venture. Principal and PNB would have stakes of 26 per cent and 25 per cent respectively while Vijaya Bank would hold the remaining 12 per cent, he said.

Mr Kapur said although the bank was keen on taking over another bank in order to increase its presence in the North, it would not wait for that to happen. Vijaya Bank opened 20 branches in the northern region this year and would like to open more in the next. The bank intends to open representative offices in Dubai, London and China.

He said that consolidation in the banking sector, particularly the public sector banks taking over other banks, would happen once the government's stake in the banks are brought down to less than 51 per cent.

Mr Kapur said the bank's treasury profits could come down in the current quarter. This is because the bank prefers to keep its securities and earn interest, rather than sell them for a premium and make a profit.

He felt that interest rates could come down further, given the liquidity in the system and the continued growth in deposits.